Vestel Elektronik wanted to facilitate future expansion into fast-growing Central European markets. How could it minimize cost, risk and time-to-market when opening new business units?
Vestel Elektronik designed integrated business processes supported by SAP® ERP applications managed in the IBM® Cloud, and is consolidating its Italy, Spain and UK operations on the new platform.
Integratesmultiple business units on a single cloud platform
Shrinkscosts and eliminates management requirements
Facilitatesfuture expansion into emerging markets
Targeting growth markets
As growth in Central Europe regains pace in the wake of the global economic slowdown, domestic demand for consumer products in the region is on the rise. For manufacturers like Vestel Elektronik, emerging markets in countries such as Poland represent valuable opportunities for expansion—but only if they can move faster than their competitors.
Coşkun Sürgevil, IT Manager at Vestel Elektronik, explains: “Europe has always been one of Vestel Elektronik’s key markets, and we are continually monitoring the region for new trends and opportunities to extend our reach.
“We see that Central Europe will become an increasingly important growth area in the coming years. If the conditions are right, we want the ability to open new business units rapidly, cost-effectively, and with minimal risk.”
He continues: “Our Italy, Spain and UK operations are managed independently within the group, and in the past each had its own separate business processes and systems. We realized that establishing new operating units with this siloed approach would be costly, complex and time-consuming, as we would need to design the new business processes from the ground up, provision the supporting business systems, and purchase new compute, storage and networking resources.
“To solve these challenges, we decided to standardize our business processes across Europe, and deliver the supporting systems from a single point. The aim was to define best-practice workflows that would boost the operational efficiency of our existing operating units, and offer re-usable templates to reduce the time required to enter new markets.”
For many years, Vestel Elektronik has relied on SAP ERP applications to drive its operations in Turkey from end to end.
“Our SAP ERP applications enable us to manage practically every aspect of our workflow—from planning and manufacturing to logistics and financials—in a single, enterprise-class solution,” explains Coşkun Sürgevil.
“Our positive experience of using SAP ERP applications to support our business in Turkey convinced us that an SAP solution was the right foundation to support our other operating units in Europe. We looked for a cost-effective way to migrate our businesses in Italy, Spain and the UK to a single, centralized suite of SAP ERP applications.”
Building integrated processes
After a thorough review of its existing processes and systems, Vestel Elektronik designed new, integrated business processes to support its Europe operations. Next, the company defined its requirements for the new SAP platform, which was to be managed by group IT services provider Zorlu Holding IT Management.
Coşkun Sürgevil comments: “Speed to market and cost-efficiency are two fundamental pillars of our strategy in Europe, and we were keen to avoid the significant capital spend required to build a new data center from the ground up.
“We wanted a partner that could deliver the SAP solutions as a managed service in the cloud—helping us to gain the agility and flexibility we need to move into new markets quickly while keeping our operational costs lean.”
After evaluating proposals from a number of different vendors, Vestel Elektronik selected an IBM managed services solution for SAP ERP applications, hosted in the IBM Cloud.
“Because we aim to manage all of our Europe businesses on a single instance of SAP ERP, high availability was one of the most important criteria for our new cloud platform,” recalls Coşkun Sürgevil.
“We wanted the assurance that our SAP ERP applications would be managed professionally in a robust, secure environment. To meet the stringent requirements of our regulators, it was also essential to find a partner that could host our data inside Europe.
“For a number of years, IBM has provided infrastructure services for our Turkey operations, and we knew that IBM possessed the expertise, solutions, global reach and resources to satisfy our requirements for the new SAP platform. Of all the cloud vendors we considered, we felt that IBM was the optimal partner to deliver and manage our new SAP platform.”
Working together with a team from IBM Global Technology Services®, Vestel Elektronik migrated its business systems from an on-premises environment in Italy to SAP ERP applications running in the IBM Cloud.
To ensure high availability, resilience for critical business data and compliance with regulatory requirements, the solution is mirrored across two IBM data centers in London and Amsterdam.
“We set an aggressive six-month deadline to provision our new SAP environments in the cloud, and IBM rose to the challenge,” says Coşkun Sürgevil. “IBM provided us with an experienced team of consultants, which helped us to keep the project running smoothly. Throughout the process, IBM never missed a deadline—helping us to transition our Italy business to SAP ERP applications in the cloud on time and within budget.”
Launching fast in new markets
Today, Vestel Elektronik runs its Italy business on integrated SAP ERP solutions in the IBM Cloud, and is preparing to consolidate its Spain and UK operations on the new platform. With integrated business processes delivered from the cloud, the company is well placed to drive rapid growth into emerging markets.
“We predict that our ability to deliver our SAP ERP solutions from the cloud will be a key enabler of our future growth objectives in Europe,” says Coşkun Sürgevil.
“By defining best practices for core business processes such as order to pay, we have created re-usable templates that will enable us to open operations in new markets rapidly and at lower cost than the previous siloed approach.
“What’s more, we avoid significant costs associated with managing and maintaining our own servers, storage and networking resources. In Italy, we have already reduced our administration requirements by one full-time equivalent—cutting our operational costs while ensuring soaring 99.9 percent service availability.”
The IBM Cloud solution is enhancing Vestel Elektronik’s ability to satisfy regulatory requirements around data retention and security.
“IBM data centers are designed to meet rigorous information security requirements, and backing up our data in the IBM cloud enables us to ensure that we retain our records for the appropriate length of time,” explains Coşkun Sürgevil. “We are confident that these capabilities will improve our ability to demonstrate compliance to our auditors.”
Coşkun Sürgevil concludes: “Thanks to SAP ERP solutions in the IBM Cloud, we are helping our businesses to focus on their core competencies. Looking to the future, we are confident that our centralized SAP business systems will foster closer collaboration between our operating units in Europe, and provide a launch pad for rapid growth into emerging markets.”
About Vestel Elektronik
Founded in 1984 and headquartered in Manisa, Turkey, Vestel is a leading producer of consumer electronics. Employing approximately 16,000 people, the company is a subsidiary of the Zorlu Group and generates annual revenues equivalent to approximately USD 3.4 billion.
- Consumer Products: Smarter Operations
- GTS Strategic Outsourcing
- GTS Strategic Outsourcing: Data Center
- IBM Bluemix
- IBM-SAP Alliance